GSHP3

General Shopping e Outlets do Brasil S.A. is a Brazilian company focused on the development, ownership, and management of shopping centers and outlet centers, with common shares traded on B3 under the ticker GSHP3. The company was incorporated in 2007 to consolidate, under a single corporate structure, interests in several retail projects and service providers to shopping centers that had been developed since the late 1980s in the Guarulhos region, in the state of São Paulo. Its operating origins date back to the opening of Poli Shopping Guarulhos in 1989, followed by the inauguration of Internacional Shopping Guarulhos in 1998, marking the more structured entry of its former controlling shareholders into the shopping center segment. From this base, the company went through an intense cycle of acquisitions, expansions, and new projects throughout the 2000s, building a diversified portfolio of retail assets. In 2007, it carried out an initial public offering, joining what was then the Novo Mercado segment of B3 and raising funds to accelerate its growth plan in the shopping center sector.

General Shopping e Outlets do Brasil’s business model is centered on the economic exploitation of retail-oriented real estate assets, through the leasing of space in shopping centers and outlets and the provision of services associated with the operation of these properties. The company operates both as an owner of stakes in shopping centers and as a manager of its own and third-party projects. Revenue comes mainly from rent charged to tenants (minimum rent and percentage rent on sales) and from condominium management services, parking, electricity, and water. In 2024, consolidated net revenue totaled approximately R$ 180.5 million, of which around R$ 56.3 million came from rent and R$ 124.2 million from services, highlighting the growing importance of the services side in the company’s revenue mix.

The leasing of space in shopping centers and outlets follows standard industry practice, with contracts of approximately five years, under which tenants pay the higher of the minimum rent or the percentage rent tied to their sales performance. The minimum rent amount varies according to the store’s size, its location within the mall, and the tenant’s business segment. In addition to rent, General Shopping e Outlets do Brasil generates mall & merchandising income by monetizing common areas through kiosks and media for product and brand advertising, as well as by charging consumers for parking. Common expenses are shared among tenants via condominium fees and contributions to promotion funds. The company also monitors tenants’ monthly sales in certain malls, using this information as an auditing and performance management tool, which helps ensure control and accuracy in charging percentage rents.

On the services side, General Shopping e Outlets do Brasil manages the shopping centers in which it holds stakes, as well as third-party properties, providing condominium management and operating complementary activities that are essential to the functioning of shopping centers. Through specialized subsidiaries, the company operates parking facilities integrated with the malls, planning, implementing, and managing parking spaces and vehicle flows in line with the specific characteristics of each asset. Its activities also extend to the planning, implementation, and operation of electricity and water supply systems, including economic feasibility studies, assessment of supply alternatives, equipment installation, and operational management. These solutions are provided by subsidiaries such as Energy, focused on power, and Wass, dedicated to water supply, and cover assets like Internacional Auto Shopping Guarulhos, Shopping Bonsucesso, several Outlet Premium locations, and other shopping centers in the group’s portfolio.

General Shopping e Outlets do Brasil’s real estate portfolio comprises different formats of shopping centers and, notably, outlet centers distributed across several regions of the country. As of December 31, 2024, the company managed 16 properties with a total gross leasable area of 319,816 m², of which 298,910 m² corresponded to shopping centers and 82,278 m² represented its own GLA, considering the company’s ownership interest in each asset. The portfolio includes projects such as Poli Shopping Guarulhos, Auto Shopping, Cascavel JL Shopping, Shopping do Vale, Unimart Shopping Campinas, Parque Shopping Barueri, Parque Shopping Maia, Shopping Bonsucesso, and several outlets under the Outlet Premium brand, located in São Paulo, Brasília (Alexânia), Salvador, Rio de Janeiro (Duque de Caxias), Fortaleza, Greater São Paulo (Itaquaquecetuba), and Imigrantes (São Bernardo do Campo). The company’s stake in each project varies and may range from small fractional interests, such as 0.5% or 1%, up to 50% or more in certain strategic outlets and shopping centers.

Historically concentrated in the Guarulhos region, General Shopping e Outlets do Brasil has gradually expanded its geographical presence to other municipalities in the state of São Paulo, as well as to states such as Paraná, Rio de Janeiro, Bahia, Ceará, and Goiás. This diversification has occurred both through acquisitions of existing assets and through the development of new projects, such as the Outlet Premium chain and regional malls. The company has also carried out capital recycling operations, disposing of interests in mature or selected assets, such as Internacional Shopping Guarulhos, Top Center, Santana Parque Shopping, Shopping Light, Poli Shopping Osasco, and others, as well as transferring assets to real estate investment funds with which it maintains corporate relationships. Among these moves, noteworthy are the contribution of several projects to a real estate investment fund in 2019 and successive sales of stakes in Parque Shopping Barueri and outlet projects, which have changed the profile and distribution of the portfolio over time.

In terms of regulation, General Shopping e Outlets do Brasil’s activities are primarily subject to urban planning and environmental legislation, as well as to municipal, state, and federal rules applicable to the operation of large commercial establishments. Shopping center projects may require environmental permits issued by state and municipal agencies or, in specific cases, by IBAMA, involving preliminary, installation, and operating license phases. The need for licensing is assessed on a case-by-case basis, in light of each project’s potential environmental impact. The company reports that environmental licensing has not been required for its projects and that it has not, to date, faced any material issues in obtaining the authorizations related to its activities. Environmental responsibility nonetheless remains a material factor, since Brazilian law provides for criminal, administrative, and civil penalties for noncompliance with regulations and for environmental damage, including the possibility of piercing the corporate veil of the controlling shareholder in certain circumstances.

From an environmental, social, and governance perspective, General Shopping e Outlets do Brasil states that it adopts practices focused on waste management, efficient use of natural resources, and regulatory compliance. In the properties under its management, there are programs for waste recycling, appropriate treatment and disposal of solid waste and liquid effluents, as well as recycling of fluorescent lamps with gas and glass recovery. Architectural designs seek to prioritize the use of natural lighting, helping reduce electricity consumption, and studies are carried out on the supply of energy from alternative sources, such as Small Hydropower Plants (PCHs) under PROINFA. With respect to water, new projects include reuse systems for cooling, garden irrigation, and restrooms, in addition to contracts with public or private companies for selective collection, waste disposal, and effluent treatment. The company reports that it does not hold international environmental certifications but notes that it is not subject to any material administrative or legal proceedings related to environmental matters, and that its operations remain guided by current legislation and the requirements of the relevant public authorities.

From a corporate and capital markets standpoint, General Shopping e Outlets do Brasil is structured as an operating holding company that consolidates its interests in shopping center projects through companies such as Levian Participações Empreendimentos S.A. and Securis Administradora e Incorporadora S.A., as well as various direct and indirect subsidiaries dedicated to the development, management, and provision of services to retail real estate assets. Common shares GSHP3 are traded on B3’s basic listing segment, following a voluntary migration in 2021, and also back a sponsored Global Depositary Shares (GDSs) program aimed at the international market, with a ratio of 1 GDS to 73 shares. The corporate structure also includes subsidiaries operating in adjacent areas, such as parking, telecommunications, power supply, water management, and retail project development, reinforcing the company’s positioning as an integrated platform for real estate exploitation and associated services in the shopping center and outlet segment in Brazil.